USD/JPY struggles near multi-week lows, below 113.00 mark

USD/JPY witnessed selling for the fourth successive day on Tuesday amid sustained USD selling.
The cautious market mood underpinned the safe-haven JPY and also contributed to the decline.
Acceptance below the 113.00 round figure might have already set the stage for additional losses.

Haresh Menghani FXStreet

The USD/JPY pair maintained its offered tone through the mid-European session and was seen trading around the 112.90-85 region, just a few pips above four-week lows touched earlier this Tuesday.

A combination of factors dragged the USD/JPY pair lower for the fourth successive day and reaffirmed the overnight bearish break below the 113.30-25 strong horizontal support. The cautious market mood underpinned the safe-haven Japanese yen and exerted some pressure on the major amid the prevalent US dollar selling bias.

In fact, the greenback prolonged its recent pullback from YTD tops touched in reaction to the upbeat NFP report on Friday and was pressured by the Fed's dovish outlook. It is worth recalling that the US central bank stuck to its transitory inflation narrative and indicated that it was in no rush to raise borrowing costs.

Apart from this, a fresh leg down in the US Treasury bond yields further weighed on the greenback and contributed to the USD/JPY pair's decline to the lowest level since October 11. The downfall could also be attributed to technical selling below the 113.00 mark, which might have already set the stage for further losses.

That said, slightly oversold RSI on hourly charts held back traders from placing fresh bearish bets and helped limit losses. Traders now look forward to the release of the US Producer Price Index (PPI). This, along with Fed Chair Jerome Powell's remarks will influence the USD and provide some impetus to the USD/JPY pair.

Technical levels to watch

USD/JPY

Overview
Today last price	112.9
Today Daily Change	-0.33
Today Daily Change %	-0.29
Today daily open	113.23

Trends
Daily SMA20	113.84
Daily SMA50	111.85
Daily SMA100	110.99
Daily SMA200	109.71

Levels
Previous Daily High	113.67
Previous Daily Low	113.08
Previous Weekly High	114.44
Previous Weekly Low	113.3
Previous Monthly High	114.7
Previous Monthly Low	110.82
Daily Fibonacci 38.2%	113.3
Daily Fibonacci 61.8%	113.44
Daily Pivot Point S1	112.98
Daily Pivot Point S2	112.74
Daily Pivot Point S3	112.4
Daily Pivot Point R1	113.57
Daily Pivot Point R2	113.91
Daily Pivot Point R3	114.16

Author

Haresh Menghani

FXStreet

Haresh Menghani is a detail-oriented professional with 10+ years of extensive experience in analysing the global financial markets.

AUD/USD holds above 0.6950 as bullish USD caps gains

AUD/USD edges lower during the Asian session on Tuesday, stalling a two-day recovery move from a two-month low, touched last week. An extended rout in the fixed income market keeps US bond yields elevated near multi-year highs. This, along with geopolitical uncertainties, helps the US Dollar retain its bullish tone despite receding October Fed hike bets. However, expectations for another RBA rate hike this month could act as a tailwind for the Aussie.

USD/JPY remains confined in a range; 158.00 holds the key

USD/JPY extends its consolidative move during the Asian session on Tuesday, trading below 158.00 amid diverging forces. Hawkish BoJ expectations support the Japanese Yen amid looming intervention risks. Meanwhile, geopolitical uncertainty and elevated US bond yields keep the US Dollar near its YTD high despite receding October Fed hike bets. This, in turn, holds back traders from placing aggressive directional bets.

$4,100: For how long can Gold defend that level?

Gold resumes the recent downtrend, approaching $4,100 early Tuesday. The US Dollar consolidates near 17-month highs amid high Treasury yields and a rebound in oil prices. From a short-term technical view, Gold’s path of least resistance appears to be down.

Zcash: NU7 upgrade sets the stage for ZEC to resume its rally

Zcash (ZEC) hovers around $1,348 at press time on Tuesday, sustaining its mild gains from Sunday. The network upgrade NU7 went live on Monday, boosting transaction speed and redirecting 60% of transaction fees into future rewards. The institutional outflow eased to roughly $3.50 million on Monday, down from $93.56 million last week, suggesting reduced pressure from redemptions.

The scarcity trade is gaining momentum – The biggest commodity moves may still be ahead

Something extraordinary is happening across global Commodity markets. Oil is above $100. Diesel has reached record prices. Copper has broken records. Global food prices are rising again. China is restricting fuel exports. Governments are releasing emergency reserves.

Eurozone inflation just hit 3.8%, its highest in three years. This chart shows why the ECB can’t simply hike its way out

The ECB would normally have a relatively straightforward answer to inflation running almost twice its target: raise interest rates. But these are not normal circumstances. This time, the bond market is already doing part of the tightening for it, leaving the ECB facing an increasingly difficult dilemma.